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tv   Closing Bell With Maria Bartiromo  CNBC  January 4, 2010 4:00pm-5:00pm EST

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insured by united healthcare insurance company. call now for your free information kit... and medicare guide and find out... how you could start saving. we should send them overnight with fedex. i already sent them. i didn't use fedex. better cross your fingers. [ man ] oh, yeah, the accident. well, you better knock on wood. remember, we did a green renovation in here, there's no wood. but russ bought a rabbit's foot. it's a bear claw. you could throw salt over your shoulder. actually, that's a salt substitute. but you should find dan -- i think he's a leprechaun. what is it about me that says leprechaun? can someone tell me please, someone? you should have used fedex. [ male announcer ] we understand. you need reliable overnight shipping. fedex. bull market or bear, traders are always hungry for ideas. trading is all about strategy. and strategy... is all about information. heat mapping shows me where the money's moving. twenty five hundred stocks... one quick look. that's where the action is. plus, this amazing gadget... it's called the telephone. i can call td ameritrade anytime and talk trades, strategy...
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anything. td ameritrade. built by traders, for traders. this is what i need. announcer: trade commission free for 30 days, plus get 100 dollars cash, when you open an account. hey, welcome back. bob pisani down on the floor of the new york stock exchange. good start to the year. stocks hold up. no sell-off in the last 40 minutes, like we got on thursday. we had nice moves in commodity stocks. dollar was weak all throughout the day. the volume, you know i've complained about the volume. we're a little over 800 million shares. and the floor of the new york stock exchange, believe it or not, that would be the highest volume day since december 22nd. so even though it's a bit anemic, i think, for the first
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dave the year. bottom line, we're still ending up on the upside. trader talk.cnbc.com and you know who is next, amanda drury. [ closing bell ringing ] it is 4:00 p.m. on wall street. do you know where your money is? i know where my money is, it's in all of the retailers here in the united states. but welcome to the "closing bell," everybody. i'm amanda drury. i'm standing in for maria bartiromo, where the dow, the s&p 500, both of them kicking off the year at 15-month highs. we'll have much more on the markets in just a moment's time. first, though, our team is covering today's top stories. >> reporter: big pharma right out of the gate, but why did the stock of the company being bought take a tumble today? i'll have that story coming up. >> reporter: gives a cautious outlook on the u.s. economy and gives thanks to u.s. taxpayers.
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>> reporter: cable broadcasters and programmers are fighting over how much content is worth. time warner cable and noose corp may have worked out a deal but cablevision and scrips are still battling it out with hdtv and food network at stage. >> okay take a look at how we finished the day on the wall street, the final numbers, if my eyes don't servely bad low the dow is hitting 10583 with the gain of 1.5%. the nasdaq at 1.7% to the upside, 2308 is the score. and 1.6% pop for the s&p 500, sitting at 1132. here'ses final numbers. let's get more on today's action, we have bob pisani, our eye on the floor at the new york stock exchange. bob? >> and complaints about volume or not, not me complaining about the volume. >> you wouldn't gripe, you gripe? >> 10600, under that earlier, we ended just shy of that. it is a pretty good start to the new year. bottom line here is we had a couple of factors that moved the market forward. quick highlight, number one, we had better than expected economic data from two source -- china manufacturing and as well as the united states.
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that helped. and number two, remember the calendar here. sit back on our laurels and did nothing which we saw a lot in november and december, it will not work anymore. people have got to start to do something, take position. what's the easiest thing to do, what they've been doing long commodity stocks. the big global commodity names had a great day. look at mexico, cemex, big mexican cement company. alumina the big australian aluminum company and mechel, the big russian company. refiners and we also had nice upgrades here, so in addition to the moves on the economic data on the calendar, we had upgrades of major sectors today. over at deutsche bank upgrading the whole refining group. oil prices around $65, that's their average for the year. important thing is lower oil prices would certainly help the refiners a bit, and demand also a bit on the upside as well.
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chemical stocks got an upgrade from goldman sachs. they in fact raised their price targets, a number of companies. dupont raised from $41 to $35. dow chemical $38 to $37. you can get the idea here. eastman chemical. so what happens here is when you get that kind of momentum, those three factors pulling in, commodities moved to the upside nicely to get a thing like the deutsche bank commodity index hitting new highs, which is a basket of all of the commodity stocks and a very important exchange-traded fund down here. that's a new high for that very important index. financials also held up very well. we had morgan stanley getting an upgrade from ubs and as well as credit suisse here. that helped throughout the day. in the middle of day, amanda, saw those financial stocks moved to the upside. in the morning it was all of the commodity names, in the late afternoon the financial names also moved up as well. >> about 10:00, didn't they? i guess a 44% gain over calendar 2009 for the nasdaq it was announced and rallying in today's session with another gain of 1.6%.
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let's get more of what's been happening out the nasdaq marketsite. scott wapner on the job. >> reporter: hey, mandi, thanks so much. it sure 2010 has picked up write where 2009 left off. had a nice gain today as well. 16-month high. big cap technology stock, almost across the board, rallying today. and really picked up after intel was upgraded before the opening bell today. take a look at shares of intel. that stock was upgraded by rw bear to outperform from neutral. price target $26 to $24. they see a pickup in the pc business as well, as increase in enterprise spending in 2010. a number of new highs for some widely held and large cap technology stocks today. apple hit a new high today. obviously, there's a lot of anticipation about a possible tablet, computer, coming from apple. 52-week high from google in anticipation of a smartphone there. orcil hitting a 52-week high today. and cisco was up better than 3%. and that was a big gain to see from cisco systems today.
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even the biopharmas were getting into it today. take a look at amgen for example, certainly the largest biopharma stock that trades over here but big gains across the board, at least pretty good ones from the likes like teva pharmaceutical and amylin and vertex. the stock was up better than 8% today. wynn upgraded from buy over at ubs. that's a considerable amount of upside there. about 20% or so there. and the valuation is what the call was there. i want to point out as well, take a look at an intraday chart. shares of rambus because some erroneous trades made in rambus in midafternoon occurring as the nasdaq says between 128 and 132 this afternoon. again, erroneous trades that were canceled in rambus. they came in at or below, about $20.7 philippe boucher and you'll see that big intraday dip there just before 2:00, when the
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shares dipped as low as $19.91 or so. so that's the story wit look at shares of it today. mandy, back to you. >> okay, scott, thanks for that. breaking news is our bread and butter here at cnbc. go down to jane wells with breaking news on northrup grumman. >> reporter: mandy in what is a blow to the u.s. economy the large major defense contractor is going to relocate i want corporate headquarters to the washington, d.c. area starting next year. it is searching for an appropriate location now maryland or in the virginia area around washington, d.c. northrup gruman got a new ceo on new years. he took over for ron sugar. and now the company says it will be moving its corporate headquarters to washington, d.c., where it spends much of its time already working with the defense department. a 30,000 northrup grumman employees work in california. most of them of course will stay here but bragging rights of vague corporate headquarters of a major company in los angeles
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leaving, one less here, mandy, one more for washington, d.c. back to you. >> okay, thanks very much for that breaking news there. jane wells. it was a strong start of the year for stocks but can the upward momentum continue? joining us now, noah blackstein portfolio manager at dynamic funds. and managing partner at skybridge capital. gentlemen, thanks very much for your time. noah, what do you think? >> i think that it can continue. a lot is based on the earnings coming through, those earnings are based in the recovery in the economy. seeing signs into the fourth quarter and into the first quarter that the economy is recovering. and we think that the market could continue upward into 2010. >> it does seem being bullish these days is very much in vogue. those bears out there last year, climbing back into that cave of worry. but must be risks out there? is it just ignoring them or are they really there. >> the biggest risk that everyone is most fearful of is what the fed will do over the next six monthsa itself relates to ending the quant taste easing
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strategy and i think that the market is also reacting to the fed's comments over the weekend, where federal reserve chairman ben bernanke said that he may raise rates. this is very positive. raising rates means that there is a private demand for capital out there. just remember low rates aren't the win-all. just go back to japan and their last deck paiptd big wall of worry of concern right now is will the fed go into half measures and start taking bactquantitative easing too soon. >> what do you reckon, noah? how do you think that they will come without this exit strategy? they must be very, very careful. they don't want to cause a major crash. flag this market way lot of lead time. >> yeah i think that they will, but i think that the reality is that the recover segoing to be coming. they have obviously a lot of more tools than -- or more arrows than last time because they can deleverage their own balance sheet of all of the stuff that they bought butidge
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in some point in 2010, rates will be heading higher, either by the fed or the fixed income markets. and you know it seems kind of cute to say it but it could probably be what causes the correction in 2010. a lot of levered players may back up a bit. a healthy correction and an opportunity but i think the cause of the correction in '10. >> correction, you are basically assuming, like, what kind of percentage -- what kind of percentage correction would you expect? 10%, 15% or bigger? a no, probably about a 10% correction in 2010. >> what about you, anthony? >> i honestly don't see that and i think that there is going to be still upside bias just because of the swashing around of the liquidity in the global markets. the fed has learn something from the japanese. bernanke's learned something from the depression. and his policy hand right now seems to be quite hot. so i think he'll stay on the accelerator for longer than people think. his signal over the weekend i think was viewed positively. it means that people are sensing
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some level of safety, less concern from him than in the past several months. >> how do you invest in that kind of environment, anthony? >> well, for me and i would always suggest to the viewers, stay in a large-cap liquid names. this is a liquidity-driven bull market. no need to chase isoterric names. go off of the coast of the united states, focus on large-cap things in brazil or china. china southern airlines is a great example. very liquid, regulated market. very high demand. things like that. stay in liquid stocks. >> you know who had a really good run -- sorry i will get to you in a second, noah. the stock in the emerging markets like brazil and china have already had a really good run. >> they've had a really good run but where you should price stocks is not where they come from but where you think they are going to, and that's all based on fundamentals. the fundamentals for these sorts of stocks are terrific right now, and the market is reflecting that especially into a day like today. >> noah, where are you investing
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for this year? >> you know in the growth fund i run and the single biggest opportunity they see is technology. most of that technology resides in the u.s. smart phones to mobility. upgrade cycle in terms of corporate capex. technology companies held in very well during this correction because it wasn't really the excesses in technology spending like there were in the previous decade but i think that right now there are a number of secular drivers of technology that i think that will make it a pretty good bull market in technology that should last for the next few years for sure. >> noah, i was doing a little segment earlier on today on m&a trends that we could department in 2010 and one of the guests said that he thought that the high-tech sector was right for consolidation. would ahgree that. >>. >> yeah. like look today if you are trying to buy a software company you are too late because oracle's bought them all. software space, oracle and ibm have bought a ton of the software companies. more of that consolidation to come. so if you are looking at companies $10 billion and under, probably bigger than billion and
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lower than $10 billion focused on clout computing. technology will not only have the growth but big boys will try to buy that growth and you'll see a love midcap companies disappear in 2010 for m&a for sure. >> noah and anthony, thank you very much for your time. the new year has started with a bang. $40 billion deal on the first business dave 2010. i cnbc's pharmaceutical's reporter mike huckman has more. mike. >> good afternoon, mandy. and yeah maybe this big m&a deal gave investors overall inspiration to buy today. typically the shares of the acquirer which has to shell out the cash, and/or stock, and take a hit on earnings, go down and the stock the seller goes up because more often than not, it's getting taken out with a nice premium but not case in in deal. shares of alcon, up 75% over the past year, by the way were
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trading above last week's closing price. but as the reality set in that novartis offserwell below that level. it's a bit complicated but according to novartis, gives it the upper hand here because it is buying another swiss company that it already had taken a significant stake in. now most people think of nort artis as a drug company. novartis has a contact lens and lens cleaning business called ceba vision. and in a phone interview with cnbc europe this morning, novartis' chairman said the acquisition of alcon will help the company corner the eye care market. >> caller: this is a move which fits very well, our strategy, as we are already active in the eye
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care business. and now acquiring world leader in eye care creates an even stronger eye care leader in the world. >> meantime, separately i know it's not a big deal especially in comparison to the $40 billion nort artis/alcon deal, only mentioning it because it part of an ongoing larger trend of biopharma partners and acquisitions. bioform medical is up 16% today because of a private german company is taking it out. pfizer bought wyeth. merck bought schering-plough. we've already got a mega merger in big pharma? check outs the blog. mandy, back to you. >> and also getting a guest on that topic as well. thanks very much for the details. a jobless recovery possible if thyear? coming up we're going to break down that very question with one economist who has been offering a bullish prediction on stocks
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and corporate profits this year. later on in the show what are the ten biggest risks to the market in 2010? we'll take a look at some geopolitical hotspots and how they could impact investors. because now you can trade u.s. and foreign stocks online, in 12 markets, 24 hours a day, all from the same account, and settle in u.s. dollars or the local currency. plus, we'll guide you with international research and realtime quotes, so you can diversify your portfolio, wherever -- whenever. and we'll be on call around the clock, while you trade around the globe. fidelity investments. turn here. but we're also in the showing-kids- new-worlds business. and the startup-capital- for-barbers business. and the this-won't- hurt-a-bit business. because we don't just work here. we live here. these are our families. and our neighbors. and by changing lives we're in more than the energy business
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welcome back to the "closing bell." i'm mike huckman with some breaking news on apple "the wall street journal" citing sources providing clarity now on off. rumors that have been swirling around the marketplace for the last couple weeks regarding apple's next device. "the wall street journal" says according to sources apple will announce that its new tablet device later this month, rather, so it's going announce later this month the new tablet, it'll have a 10-to 11-inch screen and that finally the device will not be launched until march. so again "the wall street journal" quoting sources that apple will announce the new tablet later this month. have a 10-to 11-inch screen and will not launch until march. mandy, back to you. >> and of course dubbed the i-slate by all of those techies out there. and wait to see if that is the true label that is coming out. thanks light for the breaking news there, mike huckman. checking this our "closing bell" business headloins. crude oil settling above $80 a
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barrel for the first time in two months as unusually cold weather hits the u.s. and europe. crude gained almost 3% today. stock trading volume fol a 19 month in december. and manufacturing picked up in december hitting its highest levels since april of 2006. national factory activity rose to 55.9 from 53.6 in the month of november. well, manufacturing activity is one of the many data points that economists are deciph everything today at atlanta. at the american economic associations annual meeting despite signals of late the group is more concerned than encouraged by what is aheads for the u.s. economy. that includes our next guest who was an attendee, alan sinai, president of business economics. alan, at conference, what would you say was the general mood on the ground? >> the mood was actually kind of pessimistic about the prospect for the united states economy
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and future after coming out of this terrible downturn in the financial crisis that we had. i think it's in the way of thoughtful constructive kind of criticism, but i would think definitely on the pessimistic side. >> then that would suggest, allenays bit of disconnect between what wall street is feeling and what these economists are feeling. >> that's right but remember the economists are looking at other forces and factors for wall street and for the stock market. i think it's all about earnings and interest rates. earnings will do very well especially in the comparisons with the year ago. and interest rates are very low. it will go up in 2010. but right now, the picture head on earnings and interest rates is very, very supportive to what we're seeing here at start of 2010. >> then, what exactly did all of that pessimism center on? >> it centers on longer term trends in the united states having to do with how we've come out of this downturn. and for the business side of the financial side. concerns about the free flow of
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capital and the way that washington is going with regard to policies and the use -- heavy use of the federal government in our society. that's bothering a lot of observers. and there's a lot of criticism and kind of chaotic commentary over what we're doing, how we're doing it, i would say even confusion. this is a very difficult time for the united states, policywise. the legacy of that downturn, are big deficits, a lot of debt. we've never had that much before. and an orchhang of joblessness and probably a slow growing economy but companies in my view will actually make a fair amount of profits. >> yeah, talking of the overhang of joblessness of course the big payrolls data coming out at the end the week. do you think it is still fair to say that we're in a jobless recovery. >> i do. we think we'll be up about 20,000 jobs, and remember as we move towards april and may, we
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will add census workers so we're going to get more positive months than negative months now in nonfarm payroll but joblessness refers to not a lot of jobs. and in the past two post recessions after '90, '91 and 2001, we went many months with low positive growth in jobs. that's what we mean by joblessness. and i think we'll get positive numbers but they'll be low for a long time. >> what kind of policies do you think that are not actually being deployed that should be deployed to try to stimulate more jobs? >> you know i would have prefer to see under the fiscal side a mix of policies that was tilted more toward permanent tax cuts and to spending increases, washington and the world has tended to use spending, project-type spending which really doesn't, i think, create permanent jobs and permanent growth in the economy. i would have preferred that.
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the federal reserve, the monetary policy and the work that i've presented at the meetings, gets good grades for that part of what they've been doing. finding ways to keep money flowing into the private sector and into the system so that our credit system did not collapse like in the '30s, really saved us from a much more worse result. >> alan sinai, thank you very much for your commentary today. a new day for bank of america. new ceo brian moynihan speaking for the first time since take over the job. we'll tell you what he is saying and what his plans are for the nation's biggest bank. [ male announcer ] welcome to the now network. frannie, matt and james
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the new head of bank of america making his first official address as ceo today, north carolina. cnbc's mary thompson is there with more on brian moynihan's first public appearance. mary? >> reporter: amanda, moynihan delivered a cautious outlook during a very diplomatic debut, speaking to the north carolina bankers association. moynihan reassured them of bank of america's commitment to the state. he thank you, as taxpayers, for their support during the credit crisis, and offered a mea culpa of sorts. >> we, as an industry and we as a company, cannot avoid the simple fact that we caused a lot of damage and we have to make sure that simply doesn't happen
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again. >> reporter: now, moynihan, this means on banks having higher liquidity as well as capital ratio, something of course that b of a supports. and the 50-year-old also spoke. >> i continue to be worried about vigility of the economy with in level of employment. in leads our forecasters to predict a long and low recovery. the economic hole we are climbing outs is very deep, getting out of it won't be easy and it will take some time. >> reporter: now moynihan says among b of a's 55 million consumer and corporate clients the recovery is playing out with the less affluent consumer, predictably to pay down the debt. they too are cutting cost and paying down debtancy while seeing uptick in demand they're still hesitant to hire more
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employees until they have more certainty about the u.s. economy and that will constrain growth, not only for the economy as a whole, he says but also a bit of a problem of course for bank of america as well. amanda, back to you. >> mary, thanks very much for the update. making a move to sweep up algon. bull market or bear, traders are always hungry for ideas. trading is all about strategy. and strategy... is all about information. heat mapping shows me where the money's moving. twenty five hundred stocks... one quick look. that's where the action is. plus, this amazing gadget... it's called the telephone. i can call td ameritrade anytime and talk trades, strategy... anything. td ameritrade. built by traders, for traders. this is what i need. announcer: trade commission free for 30 days, plus get 100 dollars cash, when you open an account.
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in today's business headlines at this hour, google has scheduled an event for tomorrow. the company is not talking, but it is expected to unveil the nexus one, a google design and branded smartphone. tiaa-cref sells stakes in four asian oil companies. to divest over human rights issues in the darfur region of sudan. and gerald levin and tells cnn
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th cnbs that he feels responsibility. cable sleet vision and scripps are still at a standoff. but who are the winners and the losers in this story? cnbc's julia boorstin has a few answers. julia? >> reporter: well, mandy, negotiations between cable broadcasters and programmers are heated. content providers, content owners are demanding for compensation from the cable broadcasters and its customers who could end up paying those extra costs. newscorp and time warner strug a deal before the sugar bowl on fox. paying fox50 or 60 cents per subscriber per month. a positive for other media giant cable deals. are fighting over compensation. pulling food network over a 30 million cable subscribers.
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>> we are eager to return to the table and enter into productive negotiations with cablevision. so far they've been unwilling do that. >> reporter: but cablevision says scripps is demanding a 200% fee increase that would hike customer costs saying that scripps acted in irresponsible way when pulling the channels. >> the tables have reversed so now the distributors pay the content providers, whereas previously, food network had given that signal to the distributors for free just to get distribution. >> reporter: pay tv broadcasters face their own challenges. the downturn in the housing market has slowed the growth of new cable subscribers earnings mandy, with more and more content available for free online, some customers are thinking about pulling the plug on their pricey cable subscriptions and instead opting for rabbit ear antennas those old-fashioned antennas in often many cases can access and dozens of channels. back over to you. >> thanks for that, julia
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boorstin. novartis is persuing a $39 billion deal to increase a stake in eye care firm, alcon to 77% from 25%. while the move may be good for novartis, minority shareholders could get shortchanged, getting just $153 per share instead of the $180 per share that nestle sells. top discuss this and the broader implications we have charles ellison director of the wine berg center of corporate governance at the university of delaware. and cnbc contributor. charles, get to you. i believe that one of the reasons why these minority shareholders might get the squeeze is because of the -- that the two tiered shareholder system that they have in switzerland. explain exactly how this works and why this is in place. >> typically, in most countries if you buy a control position you buy a premium but if you attempt to buy reports out the
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minority you typically at least in the united states will pay the same thing. under a different country's loss ucould treat minority shareholders differently. which is the problem i think for a u.s. investor or any investor frankly in a minority position in a company that's incorporated overseas. which is really the danger, i think, for a u.s. investors and in investing in companies that zrooint u.s. corporation. you are subjecting yourself to the loss, corporate loss, of other countries that are not typically as friendly to minority holders as we do in this country which i think is really too sfwlood but, ron, isn't there something like this two-tiered system already in the united states? >> well, there are two-tiered system, mandy, certainly there are families that have controlling stakes in a variety of different companies. media companies come to mind when one thinks about those in the u.s. and media mogalls may have controlling interest in various corporations but as was said other shareholders effectively have to be treated equally in terms of a takeover price or something along those lines if there is a stock buy back or what have you.
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they may not have control, if you have an a-share and a b-share class like we do in some companies here. but it's a little different than getting a different price for your shares which typically doesn't happen here anymore. it used to in the 1980s. not so much now. >> charles, what do you think are the broader impkapgszs for u.s. businesses right now as a result of this. >> well, i think there's been a trend in some u.s. companies to reencorp rate overseas. to seek formal dorm sasiles. in this country that tends to push companies overseas i think it is very problematic, not only from a regulate or standpoint but from the standpoint of the individual investors themselves, because overseas, the same protections that you have in this country prevents something like this from happening aren't in existence. >> which -- >> so i think that -- >> which regulations in particular do you think should be changed to try to encourage those u.s. businesses to stay here? >> well, there are a lot of things that have come out in congress. vis-a-vis reporting requirements, not so much
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reporting but regulate or requirements as vis-a-vis companies operate themselves. much more advantageous from a tax cut standpoint. to domicile somewhere in the u.s. saw you this happening a lot a few years ago, companies went to bermuda and other foreign jurisdictions to avoid certain u.s. taxes. >> mandy, if i may, though -- >> yeah, jump in, ron. >> these are very different issues than what is happening between nestle and novartis. they're not really kind of a level playing field-type issues. tax law change, where you domicile a company in order to gain tax haven status. some of those abilities for corporations are going away because of regulatory changes here. i mean i agree with charles, that there are certain regulatory and tax issues that u.s. corporations face that may make incorporating overseas more attractive, but have, very much separate from what's happening to minority shareholders in the nestle deal. >> and, ron, would you say -- actually, tackle on the tax
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issue but actually the tax burden on u.s. businesses isn't that in ernest. >> it's not. i don't think that u.s. corporations pay the lion share of u.s. government are revenues, while you know, listen, the corporate tax cut would help the economy but it's not the thing they need the most. they certainly have, not only a vaerpt of tax breaks passed in the last year and a half or so since crisis started that allowed them to carry forward larger losses in the financial sector in particular than they would otherwise. the tax hike, in the future, health care, legislation and financial regulatory reform are the things that companies have -- i think the most to deal with going forward. >> charles and ron, thanks very much for your time today. still ahead on the show the top ten risks facing the markets in 2010. find out which geopolitical hotspots will have the biggest impact in the new year when the "closing bell" continues. what are you doing...? calling chase sapphire, seeing if we have enough points to stay longer. now? you don't have enough time... and you have to push all those buttons... no buttons, someone answers every time. yeah, right... bet you a massage...
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it's getting darker and colder out there. well the geopolitical risks for investors in 2010 are likely to be more volatile than they were last year according to the eurasia group. today the firm released its top ten risks for this year. joining us on a "first on cnbc interview." i can see you on all corners are the global. >> usually singapore. >> top ten risks, last year, some of them were congress,
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south asia. >> top risk was congress and there is no question it has manifested itself. 2009 was all about the world digging out of this financial crisis and the impact of congress in terms of real policy risk with the stimulus, with the bailout and the rest, the impact that was it was going to have the u.s. economy and the world economy that was overwhelming. saw that play out over the course of the year. i think there is no question that that if we have to look at the top risk of 2009, that's where we were. >> would you say this is linked to one of the risks for this year 2010? that is, the possibility that new york/london could possibly lose their cache, their status as big global financial centerancy might actually to give a little bit of that crown to places like shanghai. >> well, it is linked in the sense that you will see financial regulation. it's the one piece of major policy that's likely to get through the united states over the course of 2010. cap and trade will be a lot harder. immigration, don't have time for. the obama administration wants to keep it pretty
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finance-friendly. but folks in congress are not going to want to give geithner everything that they want, especially because it is easy to beat up on the big banks and they've got elections coming up in november so i do think that you will see risks around that, but frankly new york and london are overwhelmingly still going to be the heads of the -- the centers of global finance. you don't change that easily because you have to have a lot of openings. >> i am sure they are quite relieved to hear that. number one, top geopolitical risk for 2010 u.s./china relations. we've seen trade spats going back and forth over the past few weeks. will this get more severe, do you think? >> i think that it clearly is. 2010 you have 10% unemployment in the u.s. you have 10% growth in china. those two things do not make 20. we had 2008 elections where you could vote for a president, obama or mccain, not nor care what their views were on china. that will not happen again. this relationship's going to get politicized and, in part because of labor, in part because of industry in the united states.
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there are whole host of reasons that despite hu jintao's efforts it will keep it hard. >> isn't it overblown though? demonized to a certain degree. >> i think that demonizing is starting and i think that demonizing will continue and i think no question there will be a difference between perception in reality. 44% of americans pulled just about a month ago said they thought that china was the world's leading economy. it's not close to that. but fact is that is the perception. and that perception's going to grow when you don't have chinese leadership on issues like climate change, and americans are saying, we're providing subsidies for what? doing cap and trade for what? this issue, it's been demonized a bit when will obama went over in november to get hu jintao and the meeting went pretty well but media didn't report it well, there is certainly a little demonization. >> so may not be number one in terms of world economy yet but number two soon when it takes over in japan. >> absolutely right. >> yes. talk about brazil since we're on some the bricks right now because you've got is t on your list as number seven and i'm wondering what the risk is here.
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it's an election year, if i am not wrong. when you have election years for emerging markets it does create volatility doesn't it. >> i think that is right. lula is probably the most leadi leading. would have never won the olympics for lula. brazil's doing so well, 5% growth coming in 2010 and only about 8% there people. a income tax. there's no direct support for a smaller state state. they want more government and as a consequence much harder for foreign investors to get into that story. that will create downside risk in 2010. by 2011 it should pick up again. >> what's the wild card? the red herring for this year? >> one red herring is actually the persian gulf. dubai's created over the last few months. all talking about yemen, in terms of the terrorist risk. but fact is that the middle east as a whole in the persian gulf in particular becoming more coherent, abu dhabi in charge of dubai in charge of the markets.
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saudi arabia looks stabile politically and economically. with higher geopolitical risk around in iran and oil going up as a consequence, persa gulf looks pretty good. winners and losers in on that, online retail coming up. who came out on top during the holiday shopping season? we're breaking down some names for kwlout "closing belyou when returns. we're just getting started here in asia and here are the stories to watch. we'll be keeping a close eye on japan airlines after reports that government will help the struggling carrier secure an additional line of credit. the bankruptcy concerns continue to hang over the carrier and staying in japan the auto sector will pose domestic sales numbers for december today. . >> after a bleak year car sales are expected to jump by onover one-third. goes on display today with the start of the delhi auto show. the the country brought the
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largest carmakers are lining up to unveil their new compact cars at what is now the second largest auto expo in the world. ñ
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well, the holiday shopping season might be over, but there's good sales out there. so it's also time to tally up the winners and losers of the critical season for retailers. jane wells has more with the latest in the laggers in the online space. jane? >> hi, we've got some new facts. pretty interesting online retail, of course, is fast growing where a lot of retail investment is going because of retailers can't respond fast, customers will get furious and click away from a site to shop elsewhere. overall gomez tells cnbc that retailers have pretty good response times this holiday, even as many process record transactions, the average time to respond to a product order
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was 16 seconds from november 1st through yesterday. now, the best sites overall for responses were apple, office depot, and tiger direct, which is not related to tiger woods. not doing so well, though, costco, jc penney, and hp shopping. for example, on the evening of december 17th, it took on average over three minutes to process a costco order online for a time there. on december 18th, at times it took nearly two minutes for jc penney's home page to load, and on november 29th going into cyber monday, completing an order at hp shopping at times was taking as long as five minutes, and people just bailed. >> that meant that almost 16 out of every 100 sample shoppers that would've signed on would've failed to be able to complete a transaction. and that type of failure leads to lost revenue in this important online channel. >> now, the next place for investment is going to be in improving the response times for people shopping for mobile devices, which if you've done
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it, you know it leaves a lot to be desired. as this increases, downsizing or shrinkage of brick and mortar stores is happening across the country. there's a photo taken of the disney store on new year's day in manhattan, permanently closed, it says. experts say, expect more of that. >> did you do any of your holiday shopping online, jane? >> about half of it online, half in stores. you know, there are pluses and minuses for each one. certainly online is convenient. but sometimes walking around the store and picking something up is just as easy. and the sales in the stores, unbelievable as i'm sure you've seen in manhattan. >> absolutely. sometimes 75% off, 90% off the sticker price. there are some really good sales out there. but i'm wondering whether the stores have been complaining about not getting enough people through their doors because of these online sales or whether they're taking advantage of that and basically opening up their own online unit. >> reporter: well, a lot of big
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retailers are using their online outlets to channel people into stores. in other words, you can order something online and pick it up at the store same day so you don't have to wait for the mail. but online is still relatively small. these store closures because experts are saying, regardless, too many stores in this country. >> always good to hear from you, jane wells. thank you very much. a look ahead at what could move the markets tomorrow. and another box office record for james cameron. find out how "avatar" is breaking box office records once again. that's coming up next. national car rental knows i'm picky.
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bringing you the first and only wireless 4g network. right now get a free 3g/4g device for your laptop. sprint. the now network. deaf, hard-of-hearing and people with speech disabilities access www.sprintrelay.com. here's what to watch for tomorrow. >> tomorrow, watch for december auto sales that should see numbers a little better than november in part because many automakers, particularly general motors pushed dealer incentives to move inventory at the end of the year. i'm jim goldman, just what the world needs, yet another smartphone. but this one's highly anticipated coming from google, we'll have the details all day long. meet innovative phone, but how will google end up pricing this
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thing? that's this wild card. and that's what will make the big headlines. i'm diana olick in washington. what happened when the first-time home buyer tax credit was extended? did people rush to buy or decide to wait? we'll find out tomorrow morning at 10:00 a.m. well, before we wind up the show, let's pop back over to matt nesto. >> let's start with idec, the company coming out after the close today and announcing he's going to retire june of 2010. he was with biogen before it merged. the stock's worth $15 billion. a little bit weaker in the after hours, but now it seems to be gaining strength. apple, little changed in the after hours, up 1.5% in the regular session.

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